TaxTMI 
TaxTMI 
2010 (5) TMI 170
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....der Section 10(23C) (iv) of the Income Tax Act, 1961. 2. Brief facts of the present case are that the petitioner - society was set up by the Government of Haryana to facilitate and simplify the admission procedure to the Technical Institutes in the University Departments, Government/Government aided/ Private Institutions located in the State of Haryana. Petitioner - society is a self funding society conducting entire admission procedure for admission to all technical courses including post-graduate, under-graduate and diploma education in all Technical Institutes in the University Departments, Government/ Government aided/ Private Institutions located in the State of Haryana. Petitioner - society also provides scholarships to the topper s....
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....n or retention of income from such activity. 15. A perusal of the income and expenditure amount of the assessee applicant for the financial year 2007-08 i.e. assessment year 2008-09 reveals that during this year, the applicant society has earned income from registration fee/counselling fee of Rs.12,42,47,115/- and also sliding fee (for second/subsequent counselling) of Rs.3,05,26,500/-. Apart from this, the applicant society has also earned Bank interest of Rs.1,38,36,099/- during this year. Its Income and Expenditure Account shows that from the gross income tatalling Rs.16,86,09,722/-, the applicant society has shown a surplus of Rs.6,12,82,168/-. Thus in the very first year of its activities, the applicant society had earned a huge surpl....
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....l/reserved category students for the course. 7. The Apex Court in American Hotel and Lodging Association Educational Institute Vs. Central Board of Direct Taxes and others, (2008) 10 Supreme Court Cases 509, in paras 38, 44 and 51 has held as under:- 38. In deciding the character of the recipient, it is not necessary to look at the profits of each year, but to consider the nature of the activities undertaken in India. If the Indian activity has no co-relation to education, exemption has to be denied. (see judgment of this Court in Oxford University Press [supra]). Therefore, the character of the recipient of income must have character of educational institution in India to be ascertained from the nature of the activities. If after meeting....
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..... 51. For the sake of clarity, we may reiterate that items such as application of income or accumulation of income or investment in specified assets indicated in clauses (a) and (b) in the third proviso are a part of compliance/monitoring conditions. As stated, however, there is a difference between application/utilization of income and outward remittance of income out of India. As discussed above, with the insertion of the provisos in Section 10(23C)(vi) of the 1961 Act, it is open to the PA to stipulate, while granting approval, that the approval is being given subject to utilization/application of certain percentage of income, in the accounting sense, towards impartation of education in India. Such exercise would be based on estimation.....
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....g on the question, as to whether income derived by the petitioner trust is being used for charitable purposes, as per the object of trust or not. Learned Commissioner refused to grant renewal of exemption only on the ground of the source of income. From the perusal of the judgments cited above by learned Counsel for the petitioner, we are of the view that it is not the source of income which is to be seen, but investment of the income. If income is being utilised for charitable purposes as per the object of the trust/society, then exemption ordinarily cannot be refused." 9. In view of the fact that the petitioner - society is set up by the Government of Haryana, neither the Government of Haryana nor the petitioner - society indulge in any ....